How to Buy a Business With Owner Financing

Business owners will sometimes finance the business to sell to another individual. Most business owners that are motivated to sell quickly are more likely to entertain the possibility of financing. With the current economic climate and financial institutions lending cautiously is the perfect time to find a business that will allow owner financing.  

Business owners decide to sell their businesses for a variety of reason. Some just want to unload a failing business, which is definitely not the one you want to purchase, but others have established a successful business that they just do not want to continue to run. Businesses are time consuming but finding the right business and staff will create a good business deal for both parties.

• Locate a business that the owner wants to sell.


• Investigate the business by
  looking at financial statements and watching the customer flow for
  several days.


• Meet with the business owner about
  buying the business.


• Ask specific questions about the
  success of the business.


• If you are interested in buying
  the business, then ask the owner about the possibility of owner
  financing.


• Consult a real estate professional
  about the terms the owner is offering.


• Accept the owner's terms of
  financing and price for the business, or return with a counter
  offer. Continue to negotiate until a settlement is reached.


• Pay close attention to the
  interest rate that the financing is based upon. A firm interest rate
  is the best way to go so there is no fluctuation in payments.


• Have an attorney prepare the
  proper documents needed for the sale and financing. If the attorney
  agrees with the documentation then sign the contracts and enjoy the
  new business.